In 2016, Mondelez International (makers of Toblerone Swiss chocolate) decided to quietly cut the size of the chocolate bar by widening the spaces between its iconic triangle-array bars while maintain the original overall length. There was less chocolate, and the price remained the same. Chocolate lovers all over the world noticed this and made their concerns well known in the media and online. The difference in the gap size was easily noticeable, but unfortunately some TPMs (Third-Party Maintainers) have begun to do the same.

In Any Race to the Bottom, No One Wins

As the TPM industry has grown, so too has the number of gold prospectors (investment) looking to find and maximize their profit. New investors have arrived to make as much money as possible and are not necessarily making operational choices that serve their clients, or the reputation for Service Quality, which this industry has worked hard to earn. Consequently, many of these TPMs have begun to dilute those service standards which have been generally accepted as “tenet of solid service.” Most importantly, such “tenets of solid service” were carefully established at the direct requests of experienced data center clients seeking support that maintained reliability and resiliency for their hardware environment. The concern is that these shifts and the risks they represent are not recognized until something bad has happened.

While many in IT Procurement are focused on price, few take the time to thoroughly examine the root causes of why select vendors continue to lower their support pricing during vendor vetting. And, most also assume that no TPM would ever risk the longevity of the relationship – or the stability of their data center environment – by diluting or eliminating elements of the service. Might this race to the bottom be enabling too many IT risks? Click Here to read a blog related to this very subject.

Gartner Research explained that there are two types of TPM providers: “Pure-Play TPMs” and “Secondary Hardware TPMs.” Even though both offer independent hardware support, they have very different business objectives. Pure-Play TPMs solely focus on data center hardware maintenance. Secondary Hardware TPMs offer hardware maintenance, but their main line of business is secondary hardware sales. This difference is key in distinguishing the motives and capabilities of the maintenance provider you may choose. Might one be more service driven than the other? Does one have greater motivation to continue to invest in support mechanisms and infrastructure?

If you are going to be entrusting your business’ digital infrastructure to any support provider, do the terms outside support, external support, or backline support give you a burst of confidence? There is nothing assuring about a company, with whom you’ve established an agreement, that turns right around and hands 99% of the service delivery over to a company – about whom you know nothing. Would you rather have full transparency so you can properly vet vendors or do you instead enjoy such surprises? Many of these secondary hardware TPMs have few field engineers or keep their support staff to a minimum and will look for the lowest cost partner they can find to cover the basics of their agreement with your company.

Spare parts and logistics are BIG differentiators between the direction a few TPMs are going and the way sparing/logistics SHOULD be done. It has become an industry expectation that when a field engineer showed up on-site to fix a problem, the client is expecting for them to have part in hand. A few TPMs have taken advantage of your assumptions or expectations. Instead, these few are now following the OEM business model of regional distribution centers, that could take a couple of days before the needed part arrives onsite. Phrases like “overnight shipping” or “regional parts depot” are used to hide their cost-cutting, but not margin-cutting strategies. It is also quite far from offering transparency with their clients. When did it become okay to dilute the marketplace’s expectations for the ideal SLA?

Nipa Chakravarti, CIO, Transalta Corp, summarized the behaviors of these unusual support providers best, “Over time, SLAs drive behaviors that are focused on delivering a minimum level of service at minimum cost to the provider. This forces IT organizations to become a commodity and not a strategic, value-added partner to the business. SLAs by their very nature are established as achievable contractual targets and can be static over time. Misused, they can be counter-intuitive to driving business agility and pace.”

On July 20th, Mondelez International (Toblerone Swiss chocolate) announced they will be reverting to the original iconic size. There are no signs that the TPMs who used the same strategy will be doing the same. If a chocolate bar caused this much outrage, shouldn’t your hardware maintenance support?

Michael Yost, SSCS Digital Marketing & Design Manager

This is Michael’s third year with SSCS, but he has been actively involved in html programming, website construction, SEO, graphic design and proactively driving social/digital engagement since he was in his early teens. In addition to his role at SSCS, he serves as an adjunct professor of digital marketing and design at a local community college in Houston, Texas. In his spare time, Michael loves engaging his family in outdoor activities and games that build creativity. He is also a life-long student of humor in the western cultures.